ISCR Case No. 25-01569

______________ ______________ DEFENSE LEGAL SERVICES AGENCY DEFENSE OFFICE OF HEARINGS AND APPEALS ___________________________________

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In the matter of: )

) ISCR Case No. 25-01569

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) Applicant for Security Clearance ) ___________________________________ ) Appearances For Government: Rhett E. Petcher, Esq., Department Counsel For Applicant: Pro se 09/22/2026 Decision ROSS, Wilford H., Administrative Judge: Applicant did not mitigate the security concerns under Guideline F (Financial Considerations). Eligibility for access to classified information is denied. Statement of the Case Applicant submitted a security clearance application (SCA) on April 29, 2025. On February 12, 2026, the Defense Counterintelligence and Security Agency (DCSA) sent him a Statement of Reasons (SOR) alleging security concerns under Guideline F. Applicant answered the SOR on March 16, 2026, and requested a decision on the written record in lieu of a hearing. Department Counsel submitted the Government’s written case on July 9, 2026. A complete copy of the file of relevant material (FORM) was sent to Applicant, who was given an opportunity to file objections and submit material to refute, extenuate, or mitigate the Government’s evidence. He received the FORM on July 17, 2026, and he did not respond. The case was assigned to me on September 14, 2026. 1

The Government’s FORM consists of the SOR and Applicant’s answer to the SOR (Government Exhibit (GE) 1), and the documents in support of the allegations in the SOR (GE 2-6). GE 2 through 6 are admitted into evidence, without objection. Findings of Fact The SOR alleges under Guideline F that Applicant is indebted to three different creditors for accounts that have been charged off in the total approximate amount of $38,646 (SOR ¶¶ 1.a-c). He admitted the allegations. (GE 1) Applicant is a 44-year-old married man, who has four children (two young adults, one teenager, and one minor) and one minor stepchild from a previous marriage. He served on active duty in the U.S. Navy from July 2000 to December 2012, at which time he received a discharge under other than honorable conditions due to misconduct. He is sponsored for a security clearance by his current government contractor employer, where he has worked since June 2023. He has been employed by various federal contractors since at least 2016. He was previously granted a security clearance by the U.S. Department of Defense at the Secret level in April 2019. He was fired from his prior employment in June 2023 for non-compliance with time-keeping policy; and left his employment prior to that in October 2021, by mutual agreement, following notice of unsatisfactory performance. He separated from his first wife in December 2022, and his divorce was finalized in October 2023. He took primary custody of their three older children, and his ex-wife took primary custody of their minor child and her child. He re- married in July 2025. (GE 2-3) Applicant did not disclose his debts in his SCA. (GE 2) He was confronted during his subject interview and discussed various delinquent accounts, including those that were alleged on the SOR. (GE 3) SOR ¶ 1.a alleges a delinquent debt in the approximate amount of $13,932 on a charged-off account. Applicant admits the debt and states that it is valid. (GE 1) The family van was repossessed after he stopped making payments and the account defaulted. As of August 2025, he was not making any payments toward this account, nor was he in communication with the creditor. (GE 3 at 3) In his answer, he stated, “a repayment plan is in place,” but provided no documentation in support. (GE 1) SOR ¶ 1.b alleges a delinquent debt in the approximate amount of $12,856 on a charged-off account. Applicant admits the debt and states that it is valid. (GE 1) The account is for a loan he took out in 2021 for furniture and a washer and dryer for his now ex-wife. He states his ex-wife never made the payments and the loan defaulted. As of August 2025, he was not making any payments toward this account, nor was he in communication with the creditor. (GE 3 at 2) In his answer, he stated, “a repayment plan is in place,” but provided no documentation in support. (GE 1) SOR ¶ 1.c alleges a delinquent debt in the approximate amount of $11,858 on a charged-off account. Applicant admits the debt and states that it is valid. (GE 1) His pick- up truck was repossessed after he was unable to keep up with the payments and could 2

not afford the registration fee. The account was closed with a delinquent balance due. As of August 2025, he was not making any payments toward this account, nor was he in communication with the creditor. (GE 3 at 4) In his answer, he stated, “a repayment plan is in place,” but provided no documentation in support. (GE 1) Applicant’s financial issues are largely a result of his divorce. His ex-wife was in charge of their finances and bills, and during their separation she stopped making the necessary payments. Between supporting their four children and him losing her half of their household income, he could not afford to keep up. (GE 3 at 4) Applicant’s finances at present are fair. He has not received any credit counseling services, lives within his means, and attributes his financial condition to circumstances beyond his control. His assets total approximately $31,000, he has a monthly combined household income of approximately $9,500, and after expenses and debts his net remainder is approximately $470. His goal in August 2025 was to resolve his smaller debts first before paying off the larger ones. He hoped to eventually resolve all his debts and start saving for his retirement. (GE 3 at 4-6) Policies This case is adjudicated under Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; Department of Defense (DOD) Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG) implemented by the DOD on June 8, 2017. “[N]o one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). As Commander in Chief, the President has the authority to “control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy” to have access to such information. Id. at 527. The President has authorized the Secretary of Defense or his designee to grant applicants eligibility for access to classified information “only upon a finding that it is clearly consistent with the national interest to do so.” Exec. Or. 10865 § 2. Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, an administrative judge applies these guidelines in conjunction with an evaluation of the whole person. An administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. An administrative judge must consider all available and reliable information about the person, past and present, favorable and unfavorable. The Government reposes a high degree of trust and confidence in persons with access to classified information. This relationship transcends normal duty hours and endures throughout off-duty hours. Decisions include, by necessity, consideration of the possible risk that the applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible 3

extrapolation about potential, rather than actual, risk of compromise of classified information. Clearance decisions must be made “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” Exec. Or. 10865 § 7. Thus, a decision to deny a security clearance is merely an indication the applicant has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance. Initially, the Government must establish, by substantial evidence, conditions in the personal or professional history of the applicant that may disqualify the applicant from being eligible for access to classified information. The Government has the burden of establishing controverted facts alleged in the SOR. See Egan, 484 U.S. at 531. “Substantial evidence” is “more than a scintilla but less than a preponderance.” See v. Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). The guidelines presume a nexus or rational connection between proven conduct under any of the criteria listed therein and an applicant’s security suitability. See ISCR Case No. 15-01253 at 3 (App. Bd. Apr. 20, 2016). Once the Government establishes a disqualifying condition by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts. Directive ¶ E3.1.15. An applicant has the burden of proving a mitigating condition, and the burden of disproving it never shifts to the Government. See ISCR Case No. 02- 31154 at 5 (App. Bd. Sep. 22, 2005). An applicant “has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance.” ISCR Case No. 01- 20700 at 3 (App. Bd. Dec. 19, 2002). “[S]ecurity clearance determinations should err, if they must, on the side of denials.” Egan, 484 U.S. at 531. Analysis Guideline F, Financial Considerations The concern under this guideline is set out in AG ¶ 18: Failure to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual’s reliability, trustworthiness, and ability to protect classified or sensitive information. Financial distress can also be caused or exacerbated by, and thus can be a possible indicator of, other issues of personnel security concern such as excessive gambling, mental health conditions, substance misuse, or alcohol abuse or dependence. An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds. 4

Applicant’s admissions and the evidence in the FORM establish the following disqualifying conditions under this guideline: AG ¶ 19(a): inability to satisfy debts; and AG ¶ 19(c): a history of not meeting financial obligations. The following mitigating conditions are potentially applicable: AG ¶ 20(a): the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur and does not cast doubt on the individual’s current reliability, trustworthiness, or good judgment; AG ¶ 20(b): the conditions that resulted in the financial problem were largely beyond the p

erson’s control (e.g., loss of employment, a business downturn, unexpected medical emergency, a death, divorce or separation, clear victimization by predatory lending practices, or identity theft), and the individual acted responsibly under the circumstances; AG ¶ 20(c): the individual has received or is receiving financial counseling for the problem from a legitimate and credible source, such as a non-profit credit counseling service, and there are clear indications that the problem is being resolved or is under control; and AG ¶ 20(d): the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts. Applicant bears the burdens of production and persuasion in mitigation. Applicants are not held to a standard of perfection in their debt-resolution efforts, and they are not required to be debt-free. “Rather, all that is required is that an applicant act responsibly given his circumstances and develop a reasonable plan for repayment, accompanied by ‘concomitant conduct,’ that is, actions which evidence a serious intent to effectuate the plan.” ISCR Case No. 15-02903 at 3 (App. Bd. Mar. 9, 2017). See, e.g., ISCR Case No. 13-00987 at 3 n.5 (App. Bd. Aug. 14, 2014). Applicant has presented insufficient documentary evidence in support of mitigation. Although there is evidence that his financial problems were largely beyond his control and unlikely to recur, he presented no evidence of responsible action under the circumstances. He has not received financial counseling or presented clear indications that the problem is being resolved or is under control. Although he states that repayment plans are in place, he provides no documentation to support his assertions. It is reasonable for a Judge to expect applicants to present documentation about the resolution of specific debts. ISCR Case No. 19-03757 at 3 (App. Bd. Aug. 18, 2021); ISCR Case No. 17-00729 at 3 (App. Bd. Apr. 3, 2019). For the foregoing reasons, mitigation is not established. 5

Whole-Person Concept Under AG ¶ 2(c), the ultimate determination of whether to grant eligibility for a security clearance must be an overall commonsense judgment based upon careful consideration of the guidelines and the whole-person concept. In applying the whole- person concept, an administrative judge must evaluate an applicant’s eligibility for a security clearance by considering the totality of the applicant’s conduct and all relevant circumstances. An administrative judge should consider the nine adjudicative process factors listed at AG ¶ 2(d): (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct, to include knowledgeable participation; (3) the frequency and recency of the conduct; (4) the individual’s age and maturity at the time of the conduct; (5) the extent to which participation is voluntary; (6) the presence or absence of rehabilitation and other permanent behavioral changes; (7) the motivation for the conduct; (8) the potential for pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or recurrence. I have incorporated my comments under Guideline F in my whole-person analysis and applied the adjudicative factors in AG ¶ 2(d). Because Applicant requested a determination on the record without a hearing, I had no opportunity to evaluate his credibility and sincerity based on demeanor. See ISCR Case No. 01-12350 at 3-4 (App. Bd. Jul. 23, 2003). After weighing the disqualifying and mitigating conditions under Guideline F and evaluating all the evidence in the context of the whole person, I conclude Applicant has not mitigated the security concerns raised under Guideline F (Financial Considerations). This decision should not be construed as a determination that Applicant cannot or will not attain the state of financial stability necessary to be eligible for a security clearance. The determination of an individual’s eligibility and suitability for a security clearance is not a once in a lifetime occurrence, but is based on applying the factors, both disqualifying and mitigating, to the evidence presented. Under the current circumstances, a clearance is not warranted. In the future, he may well demonstrate persuasive evidence of his security worthiness. Formal Findings I make the following formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of Enclosure 3 of the Directive: Paragraph 1, Guideline F: AGAINST APPLICANT Subparagraphs 1.a-1.c: Against Applicant 6

Conclusion I conclude that it is not clearly consistent with the national security interests of the United States to grant Applicant eligibility for access to classified information. Clearance is denied. Wilford H. Ross Administrative Judge 7